Warning about using credit card to pay somebody elses insurance premium

Snooze

jamalfatty wrote: »

Sounds like a bit of confusion here with the CPA's, I work for one of the lenders and can absolutely guarantee that a CPA will be honoured even if the card/account has been lost/stolen/closed - as the authorisation took place before the account became compromised or closed then it is assumed to be genuine so the fact the card has been reported as missing is irrelevant.

What may be happening for those where reporting it as being lost has stopped the payment is that the recurring payment is not actually a proper CPA, instead the merchant has retained the cardholders details and are presenting each payment as a new transaction

:cool: Hmm. I'm tempted to call BS on your post but I can't be 100% sure so won't do. When I worked for HSBC a couple of years ago I can 'absolutely guarantee' you and everyone else that if the card number changed (eg. reported as lost) then the CPA would fail because the card number no longer exists to debit the transaction.

I can also personally testify that changing your card number with Alliance & Leicester and also Nationwide will make a CPA fail as I speak from personal experience when Pipex and later Demon Internet (both ISP's) refused to cancel their respective CPAs at my request.

My advice to the OP is to do as post 2 recommended and report your card as lost. Yes I know you're going to whinge and whine with "why should I" like you've done in every other reply on this thread but that is the easiest way to solve your problem so take it or leave it.

Rob

chexum

So on hand some swear that reporting cards as lost stops all future payments (which make sense), on the other hand some swear that CPAs will be respected whatever happens... (which make some sense as well, if you want them to go on)

At some point when I closed accounts, I was told due to (Mastercard's?) rules that they must wait about 30 days for all payments to arrive (think offline transactions), could it be that CPAs can only be valid for a similar period, and that's what caused them to be seen as valid forever?

I mean if you have just cancelled a card, but a previous subscription got through, it looks like all CPA is valid, but maybe it only works for a month or so?

Moggles_2

Has anybody else experienced this problem or have any comments?

No experience personally, but some forum users have reported insurance companies continuing to charge payments to a credit or debit card after they moved to a new provider and forgot to notify the old one.

It sounds as though your friend has agreed to a regular payment termed a continuous payment authority [CPA]. Once set up, you can’t cancel it. Neither can the credit card provider (in this case Barclaycard). Only the company your friend agreed to pay can do this. Therefore, if you cancel the credit card and forget to notify the payee (in this instance an insurance company), payments will continue to be charged to the closed account.

With CPAs to a credit or debit card, you have very little control and the bank has none either. It can cancel a direct debit for you at any time or you can do it yourself via internet or phone banking. However, it looks as though a third party, an insurance company, has been given the continuous authority to debit your card and they will continue to do so even when your card account is closed.

As the customer, your friend should contact the insurance company directly and get them to stop it.

nzseries1

I just want to say thanks for this thread. I gave my sister my credit card details so she could pay for her insurance premium in July last year and since then I've been fretting they'll take it again this July! Lucky I'm on great terms with my sister and I will get her to ring up and cancel before then.

Paul_Herring

Get her to ring up now and cancel.